Learning Objective : Construct and use a trial balance.

Exercise
Learning Objective : Analyze the impact of business transactions on accounts.

Set up the following T-accounts: Cash, Accounts Receivable, Office Supplies, Office Furniture, Accounts Payable, Common Stock, Dividends, Service Revenue, Salary Expense, and Rent

Expense. Record the following transactions directly in the T-accounts without using a journal. Use the letters to identify the transactions.

a. Laura Hull opened a law firm by investing $26,000 cash and office furniture with a fair value of $8,100. Organized as a professional corporation, the business issued common stock to Hull.

b. Paid monthly rent of $2,600.

c. Purchased office supplies on account, $1,900.

d. Paid employee salaries of $3,700.

e. Paid $1,000 of the accounts payable created in transaction c.

f. Performed legal service on account, $9,100.

g. Declared and paid dividends of $2,800.